An unassuming, angular pretzel of dark piping, bolts and valves, P3B is an innovative new oil well that has the potential to revolutionize the oilsands industry and solve its “dirty oil” dilemma. That is, if the big industry players get behind it.
Developed by Petrobank Energy and Resources, P3B sits on the Calgary-based oil and gas company’s experimental Whitesands facility in the woods near the town of Conklin, 140 kilometres south of Fort McMurray. Here, the company is massaging oil extraction technology with unheard-of efficiency, a drastically reduced environmental footprint that includes low carbon emission and all but zero water use. The process also requires less capital investment and operating cash than other oilsands technologies. The oil even comes out of the ground partially refined. Oilsands bitumen is typically very thick and must be thinned with additives (diluent) to make it transportable by pipeline. P3B’s oil requires 50 to 60 per cent less diluent to do so.
Blue-suited workers are readying P3B for operation in 30 C heat under a clear blue sky. Operations manager David Reddecliff is clearly proud of the occasion. Tall and affable, he’s the public face of the Whitesands project, showing journalists, foreign visitors and oil company execs around the place. Their interest owes much to the deficiencies of the oilsands industry’s existing technologies. The bulk of oilsands production is done using steam assisted gravity drainage (SAGD), which involves injecting steam into oilsand, liquefying the oil. It’s an energy- and water-hungry technology that leaves much of the oil in the ground. As well, traditional oilsands mining, aside from its own massive energy and water requirements, famously scars the landscape.
Reddecliff, who has worked in the oil industry for over 20 years, says he’s here, at Whitesands because he wanted to work with Petro Bank’s new technology. “People say it’s too good to be true,” he says. “No.”
He takes us around the surprisingly modest facility. It’s made up of a small hive of piping, wellheads, a half dozen black oil tanks and a tidy collection of corrugated metal machine sheds. The thin, brown soil of the site stretches to the edge of surrounding evergreen forest. Orange flame licks off a small flare stack. Opened in March 2006, the site has a staff of just five during the day and three at night.
Fast Forward photographer Riley Brandt, Reddecliff and I are dressed in heavy blue coveralls, massive green rubber boots, white hard hats and safety glasses. Safety is a high priority here. At the facility’s front gate, I was advised that beards are not allowed. I wondered if my leg was being pulled. Not so. A clean shave ensures that a respirator will make a tight fit should there be a deadly hydrogen sulfide leak. The photographer was OK, but I had a day’s growth of facial hair. Thinking I was going to have to turn around and leave, I was shown to a sink and mirror at the back of the entryway security trailer and offered a disposable razor. Reddecliffe then gave us a full safety briefing in the site’s air-conditioned trailer office (no outdoor footwear allowed) and showed us his pocket hydrogen sulfide detector that emits a piercing beep when it sniffs the gas.
A small amount of steam is being sent vertically down P3B into the oilsand formation below, Reddecliff explains. Once the steam heats the bitumen to the right temperature, pressurized air will be injected, setting up what is called a combustion front — a heavy-duty oxidation process akin to turning on a stovetop element — that will heat the oilsand. The energy needed to liquefy the oil is provided by elements of the oilsand itself. The heat generated pushes crude oil to the surface through another well that runs horizontally through the formation. This process, called toe to heel air injection (THAI) can be kept moving through an oilsand deposit, sweeping it from end to end as more wells are drilled. P3B also employs the company’s newest innovation: the CAPRI process. The well is composed of two tubes, one inside the other, with a catalyst packed between them. This substance further refines the oil before it hits the surface. This is the first of three new wells to be constructed using this additional technology. The site’s first three well pairs are now producing oil.
The wellheads adjacent to P3B are hot to the touch. The gushing of fluids to the surface is audible, a deep, warm growl. With the oil comes water and various gases (like hydrogen sulfide, which is incinerated). Oilsands mining and well operations are heavy water users, while these wells produce water — approximately one barrel for two of oil. This water is now being put back into the ground, but could potentially be sold to steam projects.
Inside a small buildings, Reddecliff shows us the treater, a device that separates oil from water within a large tank. It features a series of levers on long, slender chrome pipes along a metal trough. It looks like an industrial cappuccino maker. Here, Reddecliff pours a paper cup full of clear water made lightly cloudy by gas bubbles. He then does the same with a cup of surprisingly fluid oil. Given their origin directly below us — a sand and oil mix as thick as refrigerated molasses — the two cups speak volumes.
He’s excited by the environmental implications of this process. “This is one of the reasons I came to this project,” he says, though he remains protective of the industry as a whole. He’s no fan of Stéphane Dion’s proposed carbon tax and muses that trees need carbon in massive quantity.
The oil industry was initially skeptical. Over the last 20 years, it’s sunk billions into steam technology and is hesitant to abandon it for another. Whitesands has also had problems with sand gumming its works, though, to be fair, the steam operations have similar problems and the company is working to resolve the issue. The economics of this evolving technology are solid, and there is certainly pressure on the oilsands industry to employ new technologies to lower its environmental footprint and carbon emissions. Industry’s skepticism is changing, and government is an all-out booster. Industry Canada has funded the project with $10 million, and the Alberta government has done likewise.
Though the public has yet to twig onto the difference between this and traditional, dirtier oilsands projects, no one’s complaining about the oil itself. “We produce and sell oil every day out of this project. Right now, there’s somebody driving around in Chicago on oil that was produced from this,” says Chris Bloomer, the company’s vice-president of heavy oil. At a Petrobank boardroom table across the hall from his Calgary office, he runs through a PowerPoint presentation on the Whitesands technology. He shares Reddecliff’s confidence. Petrobank, he explains, plans to take its technology global by developing joint ventures, by licensing out its technology and by launching it’s own projects — one in the Peace River area and another in northern Saskatchewan are now planned.
“We need a mindshift here,” says Bloomer. “The whole oilsands has been painted with one brush.” This new technology remains somewhat pinned under the bad press of open-pit mines and tailings ponds. And while it may have been developed here, it won’t soon sweep the oilsands. “Our biggest challenge, and the industry’s is [Alberta’s] regulatory process,” he says. “We can drill 150 wells in Saskatchewan in a year, and we’re waiting a year to get three wells approved in Alberta. We just can’t get things done in a timely way. It’s a huge resource and a huge challenge.”
